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Old 04-14-2007, 12:18 PM
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Default When did the dream of being a trucker turn sour?

This must be the week to write about truckers, with Stephen Labaton's article in the NY Times last Tuesday and now Steve Franklin and Darnell Little's article in the Chicago Tribune yesterday.

Labaton focused primarily on the regulatory cave-in by the Bush administration, which has resisted efforts to reduce the number of hours that truckers spend on the road and working. In fact, Labaton writes, the Bush administration has actually expanded the number of hours truckers can spend driving. His article failed, however, to delve into the deeper structural issues in the industry that are driving truckers to cheat, lie, take drugs and speed.

Franklin, on the other hand, goes more into some of the root causes of truckers' problems than Labaton's article last week -- particularly the fact that most truckers are now paid by the trip instead of a regular salary, making time spend waiting to be loaded or unloaded, or time doing maintenance unpaid. The pace means that counting all their time on the job, some earn as little as $8 an hour. And the fatigue and stress are not only unhealthy for the drivers, but makes the roads more hazardous for everyone. Every year, more than 5,000 people die and 116,000 are injured in truck-related accidents, according to the Federal Motor Carrier Safety Administration.

So what's going on?

When did the dream of being a trucker turn sour?

It began after the government deregulated the industry in 1980, says Mike Belzer, a one-time Chicago trucker and now a Wayne State University professor and trucking industry expert. Ever since, he says, it has been a "race to the bottom."

Before 1980, nearly 9 out of 10 over-the-road drivers were union members, he says. Today, 1 out of 10 carry a union card. That shift ushered in lower pay, fewer benefits and tougher working conditions.

It also made the highways far more dangerous as inexperienced and lower-paid drivers push themselves to earn more, Belzer adds. "You get what you pay for," Belzer explains. It is a matter of choosing between a "skilled professional" and someone "from the soup line," he says.

***

By the late 1990s much of the industry was transformed into a "sweatshop on wheels," Belzer claims. Truckers' income, when adjusted for inflation, dropped steadily as the market was flooded with new companies, new drivers, and pressures from shippers and manufacturers to keep freight costs down.

Figures from the American Trucking Association show that between 1980 and 2005, the number of interstate trucking companies soared from 20,000 to 564,000. But nearly 90 percent operate six trucks or less, according to the industry group.

The result is a highly fragmented industry with "low profit margins," according to an association study.

Out of an estimated 3.3 million truckers, about 1.3 million haul freight. Of these, about 350,000 are independent drivers. Most own their trucks but lease them to companies. Or,... they work for whoever has goods for them to carry.
And for all of the literally back-breaking work, here's what one trucker, Roger Kobernick, ends up with:

Because he cannot afford health care, he relies on state-sponsored coverage for himself and his family. They are qualified to receive food stamps, but pride stops them from doing so. In his best year he earned $40,000, but last year he made only $9,000.

Much has gone wrong for him in the last few years, and he partly blames it on freight rates that have barely gone up while fuel and other costs have soared and eaten away at his profits.

He also has made some financial missteps, among them expecting tax write-offs for his rig to help his bottom line. Instead, he owes $15,000 in state and federal taxes.

And 25 years behind the wheel have taken a toll. Last summer, barely able to bend his back, he had surgery. One doctor had turned him away, saying surgery would be foolish since he would return to truck driving.

The surgery put him out of work for four months. Without savings, he took out a home equity loan to pay bills, then sold his truck's trailer and bought a less costly model.

He also has decided to sell his 2-year-old $140,000 truck because the $2,000 monthly payments are killing him. To attract potential buyers Kobernick has had to steadily lower the asking price.

***

"I haven't had a vacation in 12 years. I have no dental. No pension. No savings," he says as the sun's dying rays filter through pine trees in South Carolina. "Hopefully, I'll catch up one day here down the line. But right now that isn't going to happen any time soon."
The grueling schedule and financial problems also take a toll on truckers mental and physical health, according to John Siebert, an official with the Owner-Operator Independent Drivers Association:

Several years ago, when glancing through members' obituaries, Siebert discovered that their average age at death was 55. In his research, he also found a higher-than-average suicide rate for members and turned his findings over to NIOSH, which has been examining truckers' health for the last few years.

Siebert says he believes such problems are linked to difficult lives and financial stress. He lists organization surveys showing that nearly 9 out of 10 of its members are obese or overweight and nearly two-thirds expect to rely solely upon Social Security when they retire.

He especially worries about produce haulers like Kobernick who have highly unpredictable work schedules. If anything goes wrong, or their schedule is too tight, they lose out financially, and their health often is neglected as they push to work longer hours.

"These guys are working 100 to 120 hours a week, and their sleep patterns are all over the clock," he says.
I wrote quite a bit more in my review of Labaton's article about the structural problems in the trucking industry that lead to these unsafe conditions. Put all of these articles together and you get a pretty frightening picture of America's highways. What are the solutions? An improved regulatory structure to start with, but until the root causes are addressed -- deregulation and the sharp drop in unionized drivers -- we're not going to get very far just attacking the symptoms
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Old 04-14-2007, 12:51 PM
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Welcome to Deregulation. Glad you could join us. Took you long enough. :wink:
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Old 04-14-2007, 01:20 PM
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Default Re: When did the dream of being a trucker turn sour?

Quote:
Originally Posted by johnnylightning

-- particularly the fact that most truckers are now paid by the trip instead of a regular salary, making time spend waiting to be loaded or unloaded, or time doing maintenance unpaid.
Hasn't this always been the case? I don't understand why he says NOW paid by the trip. Don't get me wrong, I hate spending two minutes at a dock for free, but I talk with old timers and apparently things like detention time pay is relatively new, so how was it that these guys used to make so much more money? Seems like they were on the same pay scale then as now.

By the way you should post links to the original articles.
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Old 04-14-2007, 02:01 PM
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Default Re: When did the dream of being a trucker turn sour?

Quote:
Originally Posted by merrick4
I talk with old timers and apparently things like detention time pay is relatively new, so how was it that these guys used to make so much more money? Seems like they were on the same pay scale then as now.
That's part of it. They were on the same pay scale then as now, and say $50,000 a year used to do a lot more for you when you could buy a brand new fairly nice car for $3,000.

Plus they had a chauffeur's license in every state, they ran all kinds of logbooks, they lived on pills. At least my former boss used to run like that. He was extremely strict about drug testing because he used to live on pills, and run 24 hours a day for days on end, which you had to do to make any money in a 200 HP normally aspirated gas job going up big mountains before they built the Interstate system.

Or something. I can only speak for the last 10 years, and what I see is that everything is almost exactly the same now as it was in 1997, except the HOS rules are a bigger pain in the ass now, and more companies have been bought out by JB Hunt and Swift, and Corn Flakes is a bygone memory now. After about three years, I pretty much hit the pay ceiling, and the longer I've stayed in trucking, the closer my wife who has worked at Wal-Mart this whole time has come to making more money than me. She started at $5, and is now making $14, where I started at ~$9, and am now at ~$15.00 (hourly equivalent in my case.)

That's depressing. In the long run, she'll eventually be earning more at Wally World than I will with my class A.
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Old 04-15-2007, 04:12 PM
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Unfortunately, it is one of the worst periods for the middle class in America. The middle class had it's 'glory' times, i.e. 2nd half of the 20th century.

But now it is time for the destruction of it in the early 21st century. Globalization, massive immigration, and corporate welfare are the main causes of this.

The elite want to destroy the middle class and they are doing a pretty good job of it. Nothing is more threatening to the wealthy than an educated group of people with some money.
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Old 04-15-2007, 06:19 PM
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One of the worst things to happen to this industry was the hours of service and log books. The more these special interest people tinker with it, the more difficult it is to earn a decent living and the more dangerous the roads become. I see no good use for having hours of service rules and log books other than to make money for the government and make some special interest groups feel better about themselves. Log books force drivers who would otherwise be safe drivers to push harder and longer to beat the clock in order to earn a decent living. It would be better if drivers didn't need to worry about beating the clock. We all have a different body clock. These special interest groups push for regulations that do nothing but increase the cost of doing business for carriers and force drivers to drive when they should be resting. Now they want to push EOBR's and speed limiters supposedly to make roads safer. They will accomplish nothing but to drive experienced drivers out of the industry and cost carriers millions of dollars for compliance. Were it not for compliance rules, carriers could save millions of dollars annually. If these special interest groups continue to push ridiculous regulations in the name of safety down our throats, then you will see roads become much more dangerous in the future. This country was built by individual innovation and entrepreneurship. The large carriers and special interest groups are attempting to stifle competition and innovation through needless and useless regulations.

During the 70's and 80's trucking was at it's peak in relation to power and earnings if compared to cost of living of today. Large carriers have forced rates down and stifled competition where it is difficult for smaller carriers or independents to prosper. The latter part of the 20th century and so far during the 21st century we see massive consolidation of companies which will operate much less efficiently and keep wages low. These companies have exported millions of good paying manufacturing jobs and we now import more than we export in most sectors. Higher wages for manufacturing results in higher earnings for those in the trucking industry. The government and mismanagement of funds have virtually eliminated the power of the Teamsters and other large unions. The large unions have also been responsible for many companies moving manufacturing facilities off shore. The over regulatory climate of the government has also played a part in many companies moving off shore. I have no doubt that were it possible, many of these large trucking companies would also move off shore. They will be able to reduce costs by hiring less experienced foreign drivers and buying Mexican carriers to give themselves an inroad to a pool of cheaper labor. I don't mean to sound like the voice of gloom and doom. I still believe in the American dream. So many have gotten used to the government handouts at the individual and corporate level, that it will be difficult to turn things around. Things can get better, but it will take work. We must go back to becoming more self sufficient. We don't need to look to government to solve all of our problems. We should be able to do that ourselves.
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Old 04-15-2007, 07:03 PM
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8) Gman, did you ever think of getting into politics? 8) 8)
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Old 04-15-2007, 07:25 PM
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Great post GMAN, but could you please give an example of how the HOS of today cost us the money. What I mean is from what I understand they have always had HOS rules but people use to run a few log books. From what I understand, except for many many years ago, drivers have been paid by the mile even in the 80's so I don't understand truly what the difference is. Why is it we make less money? I'm talking about a company driver not an O/O. Could you please give like an example like a 3000 mile week what it would look like today and what a 3000 mile week what it would look like in the 80's?.

It would be much easier for a lot of us new to the industry to actually visualize in an example A & B scenario how things have changed.

Thanks as always.
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Old 04-15-2007, 08:16 PM
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Did you guys read the article? The guy claimed to make a max of 40k... so what does he do.... goes out and buys a BRAND NEW 140K TRUCK...

Hello? Anyone here? My god, this guy lacks serious financial planning.

BTW how does he pay 15k in taxes if he only makes 9k? He really does NOT have a business sense whatsoever.

Quote:
In his best year he earned $40,000, but last year he made only $9,000.
Quote:
He also has made some financial missteps, among them expecting tax write-offs for his rig to help his bottom line. Instead, he owes $15,000 in state and federal taxes.
That doesn't make any sense.

Quote:
And 25 years behind the wheel have taken a toll.
You'd think 25 years of experience and he'd have some business sense

Quote:
He also has decided to sell his 2-year-old $140,000 truck because the $2,000 monthly payments are killing him.
A truck that he shouldn't have bought in the first place.

Maybe he just works for too cheap?
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Old 04-15-2007, 08:23 PM
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Quote:
Originally Posted by GMAN
The more these special interest people tinker with it, the more difficult it is to earn a decent living and the more dangerous the roads become.
Quote:
Log books force drivers who would otherwise be safe drivers to push harder and longer to beat the clock in order to earn a decent living. It would be better if drivers didn't need to worry about beating the clock.
I agree with you in a sense, that the HOSR really dont cater properly to our body clocks. But I have to disagree that you cannot earn a decent living under HOSR.

If you can't, then get out of trucking. There's more then enough hours available. Even under the current HOSR, you can work yourself to death. 70+ hours a week is almost double what the average person works.

If you can't make a decent living under the HOSR, and must run illegal to make ends meet, make that truck payment, etc...

GET THE HELL OUT OF TRUCKING!

(no this isn't directed at you GMAN, but rather anyone that *needs* to run illegal)
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